On my way to becoming an economist

Menu

Category Archives: Politics

Post navigation

To prepare for my summer trip, I have started reading about Africa in general and Uganda in particular. Here is a list of books recommended by my professors and which I think might be interesting:

Lovers on the Nile. Richard Hall. It is written in the 1980s so there are few reviews available. It seems to be a biography of two explorers searching for the source of the Nile.

The White Nile and The Blue Nile. Alan Moorehead. Classic books about history of the Nile region. The former is about Central Africa while the latter is about Egypt and Ethiopia.

Captain Sir Richard Francis Burton: The Secret Agent Who Made the Pilgrimage to Mecca, Discovered the Kama Sutra, and Brought the Arabian Nights to the West. Edward Rice. Describes the life of Captain Sir Richard Francis Burton, who explored India,
the Near East, and Africa, went to Mecca, discovered the Kama Sutra, and introduced the Arabian Nights to the West (Amazon).

Cry, The Beloved Country. Alan Paton. A story about Zulu paster Stephen Kumalo and his son Absalom in the background of racial injustice in South Africa. A classic. I am planning to read it on the plane.

Uganda Since Independence: A Story of Unfulfilled Hopes. Phares Mutibwa. The author, a Ugandan historian, guides readers through the Uganda post-independence history with comments about impacts of different regimes. Useful reading for anyone who wants to know more about Uganda politics since independence. Here is an excerpt:

When it came to nation-building, Tanzania and Kenya, Uganda’s sister-nations in East Africa, were luckier than Uganda in many ways. Tanzania had tribes that were mostly small and scattered widely round the arid centre of the country, … , a common African language, Swahili. In Kenya the prolonged struggle for power and independence with European settlers proved to be of immense political advantage to Jomo Kenyatta in forging a united nation despite the existence of many tribes. In Uganda … the country contains ethnic groups, each with its unique cultural features and outlook … the population is divided into three major linguistic groups … these groups did not augur well for the new state.

The Teeth May Smile but the Heart Does Not Forget: Murder and Memory in Uganda. Andrew Rice. About the violent reign of Idi Amin.

First Kill Your Family: Child Soldiers of Uganda and the Lord’s Resistance Army. Peter Eichstaedt. American journalist unfolding the stories of child soldiers in Uganda.

I don’t think I will have the time to read all of them, but this list will provide a reference. Comments and suggestions are welcome.

Yale professor and celebrated writer James Scott gave a talk at Duke today. He walked us through a set of interesting ideas in his new book The Art of Not Being Governed. A similar interview is here. His main argument is that Southeast Asian upland people choose their living arrangements, farming practices, and even illiteracy (over which I have doubts) strategically in order to remain stateless.

The area he refers to is called Zomia. It is a mountainous region consisting of parts of seven Asian countries. The people in this area have remained anarchist throughout the history.

He first pointed out that sedentary crop farming is usually necessary to establish states, as can be demonstrated by civilizations in major river valleys all over the world. However, states can also emerge without sedentary farming. For instance, trade and transportation centers can also turn into states.

States have control over its territory and interact with areas beyond its territory — “barbarian peripheries”. Historically, states trade with and demand labor (slavery) from peripheries. This statement is no longer after World War II for two reasons. First, accurate positioning technologies have increased states’ capacity to occupy the full territory. Second, “barbarian peripheries” are no longer fiscally sterile. Their rich natural resource deposits are often necessary for states to advance in science and technology.

Hills, valleys, and wetlands are three geographical environments that lead to different population arrangements and institutions. Wet rice cultivation is widespread in valleys because of good irrigation, while slash-and-burn is more prevalent in hilly areas. According to Scott, societies are more egalitarian in hills than in valleys. Kingdoms are more likely to occur in valleys. One reason may be that wet-rice farming requires skills and is likely to differentiate households with different level of productivity in terms of income. On the contrary, slash-and-burn requires little sophistication and is likely to generate similar incomes for all. Another reason may be that valley residents are likely to produce more surplus, and the increase in surplus calls for an institution — a state — to allocate the surplus, to facilitate trade among people, and to establish norms and regulations.

The most interesting concept in Scott’s lecture is “runaway crops”. Scott made a case that wet rice production is favorable for tax collectors because rice grows above the ground and matures at a predetermined time. Tax collectors can come at the harvest season and easily demand the amounts due by the household. By contrast, root crops such as potato and maize are easy to grow but not immediately visible at harvest. Such crops will make tax-collection difficult. It is also surprising for me to learn that people seem to adjust their portfolio of farming produces depending on their desired relationship with the state. They may plant crops maturing in different seasons so that one-time tax visits are not profitable for the state.

Although I have found Scott’s arguments about the relationship between geographical features and governance schemes compelling, I still doubt to what extent do the “barbarians” select into such lifestyles.

Seeing Like A State by James Scott is in my reading list for the vacation. So far I have found the book insightful and provocative. As it says on its cover, the book is about “how certain schemes to improve the human condition have failed”. I’ve been jotting down my thoughts as I read along. The following are my thoughts on the first two chapters.

The author started off by comparing the state to a forest. To get an idea about the composition of a forest, one has to classify the trees into several categories with certain standards, and record the number of trees in each category. This procedure sacrifices precision for the general idea (the “big picture”). Likewise, if a states needs to manage its people for fiscal or political purposes, it has to assign unified measures to people to categorize them.

The tension between local powers and the central government is present in all states. The central government is the political focal point and steers the policy direction of the whole country. But it lacks information about local situations, which may discount the effects of policy implementation. This is especially evident in ancient and contemporary China given its size and heterogeneity among regions. Qin Shihuang (the first emperor in China) unified units of measurement and currency. This accommodated for market activities between regions and fostered political unity. Without comparable units of measurements, market activities are limited to a small, local scale. Units of measurements also comes into play in tax collection.

These arguments remind me of what I learned in my development seminar. One feature of the development microeconomics is nonanonymity. Everyone in the village knows each other well. Trust can be established easily through repetitive interaction. When market transactions are limited to the local community, it seems safe, but it also greatly restricts the resources available. As the market grows, people will need to interact with the outside to consume a wider array of goods, to gain more information, and to make more diversified investment portfolios. These requires the adoption of unified measurements and currency, accepted rules about market order, and legal enforcement institutions.

The author argues that the administrative simplification of the state progresses from control over nature (e.g. forest) to control over space (e.g. land tenure), and then to inherited, permanent patronyms. In China, many patronyms were given in the Qin dynasty for better identification and easier tax collection.

The state can design cities to be more legible to outsiders and therefore increase its control over local areas. An example is the redesign of Paris. The military security of the state was the central concern of Louis Napoleon’s and Haussmann’s plans. The boulevards were designed to be wide and directly accessible from the center, which allows the army to march quickly in case of insurrection.

My thoughts are based on the book The Economic Origins of Dictatorship and Democracy by Daron Acemoglu and James Robinson. The book discusses how the economic conditions of countries affect their paths of political institutions. Here the word “democracy” is defined by Schumpeter to be

The institutional arrangements for arriving at political decisions in which individuals acquire power to decide by means of a competitive struggle for the people’s vote.

There are four paths of political development: nondemocracy to democracy (Britain), unconsolidated democracy (Argentina), nondemocracy without repression (Singapore), and nondemocracy with repression (South Africa before the collapse of the apartheid regime).

Social choices are conflicting because there are two groups: the elite and the masses. Here the elite might be the (relative) rich and the citizens be the (relative) poor. In a nondemocracy, the political institutions represent only the interest of the elites who have de jure political power. But the citizens have de facto political power in a sense that they can launch a revolution to topple the existing political institutions. This is referred to as a revolution threat. Faced with a revolution threat, the elite can repress or make a concession. When costs of repression are low (South Africa in apartheid regime), they choose this. Otherwise they make a concession. For the latter choice, they have to transfer the de jure political power to the citizens. Because de facto political power is transitory, citizens require long-lasting political institutions to ensure that majority preferences will be the yardstick of future policies.

For democracy to make it, the society should be moderately unequal, because there’s no reason to adopt democracy in an egalitarian society and too much inequality will greatly increase the burden of the elites once resources are redistributed. I find the inequality argument convincing. If the country is too unequal, on the one hand the citizens want very much to revolt, on the other hand the elites take all means to repress. The result is bigger loss of physical and human capital, and an unstable regime or even one switching between democracy and nondemocracy

The composition of wealth also matters in the process of a country’s potential move to democracy. If the major source of income is land, it can be easily taxed, so land owners are more afraid of democracy for its redistributive nature. By contrast, if the main source of income becomes human or physical capital, it is harder to tax them and the elites who own them fear democracy less.

The level of democracy cannot be easily measured, mainly because not all the countries have the institutional arrangements of democracy. There are measures like the Freedom of Houses Index and Composite Polity Index and so on. Countries with higher income and education level are generally more likely to be democratic, but correlation is not causation and once we take out many country specific factors, the relationship is not so significant.

References:

Daron Acemoglu and James Robinson. The Economic Origins of Dictatorship and Democracy. Cambridge University Press, 2005, chap 1-3.

The Chinese monarchy lasted for several thousand years and had great impact upon the economic and social structure of the contemporary Chinese society. The ideology and mechanism supporting autocratic elements entrenched in the Chinese political system persist long after the original institutions collapsed. In this paper, I will use theories of autocracy, dictatorship to analyze the central power balance mechanism of the Chinese monarchy.

I. The Theory of Autocracy in the Chinese Setting

A hereditary monarch and a dictator are fundamentally different. The former faces less risk of being overthrown because there are pre-existing legitimacy and ethical grounds for him to “speak for the divine” and possess the ultimate decision power. A dictator’s legitimacy is easily questioned. Dictatorship tends to be transitory, but hereditary monarchy lasts longer and is more stable (Tullock, 1987). The relative security enables a hereditary monarch to adopt policies with longer time horizons and structure the government in a delicate balance of power.

For a dictator, it is important to curb his launching organization after gaining power. Haber (2006) suggests three methods to achieve this goal: co-optation, organization proliferation, and terror. Although a hereditary monarch usually does not have a launching organization (except for the first emperor of a dynasty), he still need to keep control over major government officials and other interest groups so that they cannot challenge his supreme power. In Han and Tang, the emperor held major stakes in the country and could blame and fire the chancellor. The chancellor acted like the emperor’s secretary.

II. Central Power Balance

1.Co-optation

I refer co-optation in the Chinese context to the rent sharing between the emperor and multiple interest groups on which he relies to run the country. The key to co-optation is the source of rent. For stability, three parties are usually involved in rent sharing: the dictator, the leadership of the organized group that can sanction him, and a group of investors who generate a stream of rents in privately owned enterprises (Haber, 2006). Throughout pre-industrial Chinese history, private owned enterprises never fully developed and thus the last group was absent. Instead, Chinese monarchies were based in a “flat society” (Huang, 1988) where the vast population of peasants contributed tax for government expenditure. Therefore government officials who implemented policies can be viewed as the party to generate rents. The monarch had to establish a scheme of rent sharing between himself, his administrative officials, and sanction posts in the government.

The Tang dynasty set an example for the central government structure. Instead of the Chancellor (宰相) as the primary single minister of the government (as was the case in Han), the Tang adopted a “rule by committee” system (Chien, 1982). Three administrative departments (三省) — the Imperial Secretariat (中書省), the Imperial Chancellery (門下省), and the Executive Department (尚書省) — shared the highest administrative power. The power of drafting and issuing policies lay within the three departments, and the emperor only needed to sign on the draft. A decree could not be effective until it was passed by the Imperial Chancellery. Remonstrators (諫官) attached to the Imperial Chancellery were responsible for censoring the signed decrees. If a decree needed to be revised, the Imperial Chancellery would send suggestions to the Imperial Secretariat and the previous procedures would repeat. Therefore, the Imperial Chancellery retained the “counter signature” power (Chien, 1982). The Executive Department consists of six ministries (六部), personnel (吏部), finance (戶部), rites (禮部), war (兵部), justice (刑部), and public works (工部), which implements policies according to their specialization.

The emperor did not have the final power to decide a particular policy, and considerable power was given to high-rank government officials. But there exists a fundamental conflict between the emperor’s arbitrary power and the rigid censorship required. The emperor could always find ways to evade the regulations and carry out the decision to his discretion. For example, Empress Wu (武則天) passed decrees without being censored by the Imperial Chancellery. This conflict was finally resolved in Song dynasty when the final decision power was returned to the emperor. Imperial Secretariat was instructed to draw up decrees reflecting the emperor’s view and Chief Ministers (丞相) were only responsible for the implementation of the decrees. Moreover, the Imperial Secretariat and Imperial Chancellery were moved out of the Three Departments. The remonstrators were obliged to comment according to the emperor’s will. Political power was concentrated to the emperor.

2.Organization Proliferation

Chinese emperors often promulgated organizations to create confusion and internal conflicts within government officials, therefore restricting the power of the officials.

The Ming dynasty represented the peak of the emperor’s absolute power over the country. During the previous dynasties of Han, Tang, and Song, the emperor’s power was always kept in check by Chief Ministers, although the allocation of power varied from time to time. But Ming Tai Zu (明太祖) abolished prime ministership and left only a set of subordinate officials to carry out daily government routines. In addition, the head of the Censorate (督察院) and the other two commissioners were formed into the Nine Chief Ministers (九卿). Since no Presiding Minister (尚書令) or Vice Ministers (左僕射，右僕射) were present, the six ministries began to operate separately. The task of coordination was left to the emperor. By creating more organizations, the emperor greatly increased the cost of collective action against him and improved his security. But this came at the cost of declined government efficiency.

3.Terror

Some emperor created terror within the central government and among the masses. The fear of being punished by devising policies against the dictator’s will would make the government officials the mere puppets for the emperor. But creating terror is highly risky and is likely to undermine the administrative efficiency.

The Qing dynasty was one ruled by the Manchus. As “invaders”, they had weaker legitimacy to govern the country and were especially concerned to the security of their political power. The Qing government lacked “rational institutions” established for the public interests (Chien, 1982). Instead of literati running the government, the Qing placed the government in the hands of the Manchurian tribesmen who firmly supported the emperor. Emperor Yong-Zheng (雍正) set up another secretarial government organ, the Grand Council (軍機處), in addition to the Grand Secretaries left by the Ming. The Grand Council evolved into a tool for the emperor to exercise arbitrary power. The emperor could issue direct orders to local officials by “court letters” and maintain direct control of the whole country, thus creating secret policies unfettered by existing rules.

This might appear weird to you at first sight. People usually speak of “the power of entry” or “limited entry” in monopoly industries. And we know that the power of entry can give existing players exorbitant profits. The power of exit, however, seems to be rather counterfactual: Why do you need a power to exit? What does it apply to?

The power of exit has important implications in the sphere of social sciences. Democracy provides people with the right to exit. Voting gives people the chance to reject certain leaders if they feel unsatisfied with them. This is the most manifest in the Liberalist view. Social hierarchy can deny people’s right of exit. A serfdom arrangements prevents people from exiting the system once they sign the contract (or hereditary even without a contract). In public finance, the power of exit also means a great deal of freedom and sometimes better social welfare. I was looking into the pre-primary school voucher scheme in Hong Kong, and I discovered that the poor people might be better off if the voucher could be redeemed for other uses (I have a post on this issue). By setting the voucher value to be only redeemable in education, the government is essentially forcing the poor to consume more of the education good instead of other goods which might be more valuable for them.

Economic models used to suppose that capital is restricted to a particular country and could be taxed efficiently. But in the contemporary world where factors of production are highly mobile, this is no longer the case. The tax on producers are often transmitted to land owners simply because they don’t have the right to exit for land is immobile.

This sounded weird at first insight. Chinese emperors had absolute political in their hands. Why do they have to share their power, then?

A ruler always makes sure the elite class is on his side. The personnel selection system is often used as a way for the emperor to share power with the elite class and thus consolidate the base of their legitimacy. From a society in which social position and political power were based largely on kinship credentials, China was transformed into a meritocracy in which social prestige and political appointment depended mostly on classical examinations to establish legitimate academic credentials (Elman, 1989). For the emperor, producing talented and loyal officials for the state to employ had been the prime concern. Also, by spreading the chances of participating in politics among the masses regardless of their family backgrounds, the emperor promulgated a feeling of equality and empowerment of the poor.

The emperor also created many organs to limit the personnel power of the chief ministers. If the central government officials were equipped with too much power to appoint lower ranked officials, they would create clans and influence the emperor’s actual decision power in important country-level matters. Moreover, since China had a vast territory, transmission of information was cumbersome. With excess power in hand, the central officials could establish barriers between the emperor and the local officials and skew the information in their favor. The Song emperor proliferated personnel management organs by creating Council of Merit Rating (考課院) which was later renamed the Council of Administrative Personnel (審官院). The Council of Administrative Personnel was again divided into two parts — Eastern Council (東院) for civilian officials and Western Council (西院) for military officials. The complex personnel arrangements made the Chief Ministers no longer have the complete authority over appointment of lower ranked officials. Therefore the power of the emperor was enhanced.